Lukin Corporation Reports the Following First Year Production Cost Information

question 22

Essay

Lukin Corporation reports the following first year production cost information:
$$\begin{array} { | l | l | } \hline \text { Units produced } & 62,000 \text { units } \\\hline \text { Units sold } & 59,000 \text { units } \\\hline \text { Sales price } & \$ 350 \text { per unit } \\\hline \text { Direct labor } & \$ 41 \text { per unit } \\\hline \text { Direct materials } & \$ 15 \text { per unit } \\\hline \text { Variable overhead } & \$ 150 \text { per unit } \\\hline \text { Fixed overhead } & \$ 4,340,000 \text { in total } \\\hline \text { Operating expenses } & \$ 1,000,000 \\\hline\end{array}$$ a. Compute production cost per unit under variable costing.
b. Compute production cost per unit under absorption costing.
c. Determine the net income using variable costing.
d. Determine the net income using absorption costing.

---

Definitions:

Consumerism

The protection or promotion of the interests of consumers; the preoccupation with and inclination towards the buying of consumer goods.

Corporate Social Responsibility

A business practice involving initiatives that benefit society and contribute to sustainable development.

Stakeholders

Individuals or groups that have an interest in or are affected by the activities and decisions of a business or organization.

Sarbanes-Oxley

A U.S. law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to securities laws, following financial scandals at companies like Enron and WorldCom.